Report: Stimulus-backed solar company lays off 70 percent of workforce

posted at 6:35 pm on February 29, 2012 by Tina Korbe

Further evidence that when government officials usurp the role of the free market to choose winners and losers, they inevitably shuffle taxpayer dollars across the table to … losers. The Heritage Foundation’s Lachlan Markay reports:

President Obama used a weekly address in July 2010 to tout his stimulus package’s support for the solar industry. One of the companies he mentioned specifically, Abound Solar, just announced that it will lay off 70 percent of its workforce.

Abound would “creat[e] more than 2,000 construction jobs and 1,500 permanent jobs,” Obama claimed, and would be integral to the administration’s quest to “create whole new industries and hundreds of thousands of new jobs in America.”

But a year and a half later, the company’s staff numbers only 120. It announced Tuesday that it would lay off 180 full time and 100 part time employees, halt solar panel production, and delay the construction of a manufacturing plant in Indiana.

Just how much money went to Abound Solar through the Energy Department’s 1705 renewable energy loan program? So far, the company has drawn $70 million of its $400 million loan. The company won’t be able to draw more until it resumes production.

Meanwhile, natural gas advocates now seek federal subsidies (and make suspect donations to liberal think tanks as a part of their quest). Haven’t we learned our lesson? In an excellent editorial today, The Wall Street Journal editorial board explains that subsidies for natural gas are, in principle, no different than subsidies for solar. Furthermore, the board argues, the many advantages to natural gas are more reasons to oppose government intervention in the industry than to support it:

The natural gas shale revolution is a blessing for the U.S., but its very abundance and low cost mean that it could be a commercially viable substitute for oil without taxpayer handouts. At current prices, a gallon of transportation fuel from natural gas costs about one-third to one-half less a gallon of gas from oil. That’s a big nonsubsidized cost advantage.

Mr. Pickens claims that the subsidies are merely to finance the transition to natural gas vehicles, and that they will be temporary. But there were no subsidies for Henry Ford to build the Model T, and no tax incentives for gas stations in every town in America.

As for “energy independence,” taxpayer subsidies have a miserable record of reducing reliance on foreign oil. In the 1970s the feds spent some $2 billion on synthetic fuels, which were a commercial bust. Ethanol was sold as a path to energy “security,” but 30 years and more than $40 billion later it still can’t compete without governmental support. The two-decade federal nourishment of solar, wind and other non-hydro renewables has cost tens of billions of dollars, yet they still provide just 3.6% of U.S. electricity.

The history of energy subsidies is that they become an industrial and political addiction that is difficult to stop, no matter the results, and may even inhibit innovation and profitability by providing a crutch.

We are also told that government must subsidize natural gas because the OPEC cartel blocks a free market in oil. But OPEC is not the only price-setter in oil markets, and in any case the point of a cartel is to hold the market price artificially high, which should help natural gas and renewables. If the world is running out of oil (doubtful), and prices will rise over time (maybe), this should only make natural gas more promising without federal help.

As someone who would love to see natural gas take off as a transportation fuel (it’sclean, affordable and all-American!), I still want no part of crony capitalism. The purpose of government is to secure the inalienable rights of man. Those rights do not include “the right to a profitable business.” Entrepreneurship always involves risk. Sometimes, the risk turns out to be worth it. Sometimes, it doesn’t. Government policy should seek to ensure that entrepreneurs have the freedom both to succeed and to fail.

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Politicians aren’t successful venture capitalists because their decision-making process is guided by what is politically convenient.

Episodes like this don’t even show the extent of the damage produced: the invisible distortions caused by interventionist government programs – in terms of capital misalocations, malinvestments, etc – is more serious and deeper than the visible, direct, loses.

Other countries have natural gas conversions that also run on gasoline. When you run out of natural gas, you flip a switch and run on gasoline. Why can’t we do it here? EPA
You get the government out of the way there would be no shortage of conversions to natural gas. Right now there are only a couple of “authorized” conversions and they are a complete conversion to natural gas which can get pretty expensive if you put in a home refueling station.

Since the introduction of the catalytic converter, natural gas is no cleaner than gasoline for an automobile engine. It would get slightly less fuel mileage and produce exactly as much pollution per mile traveled of exactly the same sort as a modern gasoline vehicle. About the only major pollutants these days from a gasoline vehicle are some unburned hydrocarbon and nitrous oxides that are burned in the catalytic converter and converted to H2O, water vapor, and nitrogen gas.

There really is no technical advantage these days of natural gas over gasoline for personal vehicle transportation other than personal appeal if you happen to like it. Your oil and valves will be cleaner, though.

How sad. We saw this plant last fall as we were driving through IN. My husband and I discussed whether it would be one of the next stimulus failures and we were fairly certain it would be. This plant was to have been a source of revenue for the local government and jobs for the locals. A lot of cash was squandered by the state and/or local governments to draw this company to IN. Wasted time and wasted money. I believe the only winner is Chrysler who had originally built it for it’s transmission production. I wonder who reaped the cash from that sale?
I did find this link and it looks like IN laid out $500 million to make this happen and Tipton County gave out $13 million. You and I as tax payers gave them $400 million.http://www.insideindianabusiness.com/newsitem.asp?ID=42468

I pray the GOP will use all these failed companies in commercials. One after another after another. It is beyond stunning, how much taxpayer money Obama and the democrats have given out to their donors and friends. Hell, they even gave Obama’s buds at Gitmo a 3/4 million dollar soccer stadium.

Incomprehensible. Never in my life, have I found myself thinking “WTF?” as I have in the past three years.

If you think about the results U.S. pulling the missile defense system out of eastern Europe, its relationship with Russia, South Korea, Egypt, and Israel (just to name a few), solyndra, fast and furious, gas prices and energy policy, the bailouts, TARP II, Obamacare, NLRB/Boeing, infringement on religious freedom, personal attacks on private citizens (which they’ve been doing since coming into office), class warfare, unemployment, and the corruption of Lightsquared, and firing inspector generals who shine the light on Obama’s friends; examples of only a few of the avalanche of mischief and missteps of this administration: the Obama presidency has so far been nothing but prolapses, relapses, and just plain lapses.

When Obama leaves office there will be wind-blown detritus piled against the White House fence, scavenging rats, broken windows, and dogs copulating on a White House lawn gone to seed.

Obama and the “Green Industies” are Democrat-Party-money-laundering methods. They’re taking from the taxpayers under a ruse of investing in these irregular organizations from whence the money — MYSTERIOUSLY — vanishes! Where’d it all go?!?! To the DNC and Obama’s re-election campaign and therefore, to Obama when he leaves the White House, at least a lot of it.

Assuming that the campaign is not in the red, the candidate has three choices under federal election law:

1) Keep it in the campaign account for the next campaign;

2) Donate it to other candidates or to the candidate’s political party; or

3) Donate it to a 501(c) orgranization (a charity).

The candidate does not to keep it personally. The ultimate disposition of any campaign funds must be disclosed in reprots filed with the FEC.

Of course, there are various methods by which “charitable organizations” and that money ‘donated’ can be redirected to the personal benefit of a candidate who has left office. Like a mortgage mostly paid for or granted at a very low price and/or rate and other services performed with nominal if any charge/fee associated, like planes available to fly anywhere the guy or family wants, hotels free of charge, so to speak, etc.

Our Energy Policy should make every red-blooded America sick. Why should we buy oil from any foreign country be it friendly or otherwise. We should’ve been energy independent decades ago. Instead, we’d rather buy oil from thugs and tyrants. This is what you get with big government trying to micro-manage everything. 15 Trillion dollars in debt says it all and yet we vote for the same clowns, hoping that they’ll fix it? HUH? The only thing growing is government. Only the government has the right to be greedy.

This isn’t just another job loss story. Abound Solar is tied to Pat Stryker–Colorado equivalent of George Kaiser and Solyndra. Stryker is an Obama bundler and has given millions to state Democrats in Colorado.

Further evidence that when government officials usurp the role of the free market to choose winners and losers, they inevitably shuffle taxpayer dollars across the table to … loserscampaign contributors.

Why dont you follow the money? Did any of this money and, how much,ended up
In Odumba’s pockets? He has robbed the country blind. All of this graft can not happen if people are not giving back par of the money. It is next to impossible to get rid of anyone when they are buying everyone in sight!